Serious sand

Thursday, June 28, 2012

To North American railroads, sand is sand. However, to Halliburton and other firms involved in the oil and gas industry’s new wave of hydraulic fracturing, there’s no such thing.
There are about five different grades of sand for drilling. Mixing different grades of sand can have devastating consequences on the equipment at a multimillion-dollar drilling site.
Premium glacial sands are mostly extracted from quarries around the Great Lakes region. Getting suitable railcar capacity into these sites has been a challenge with the limited rail infrastructure and greatly increased demand for this sand in recent years, explained Timothy Wesbey, director of Latin America and U.S. domestic transport at Halliburton.
The rail infrastructure and transport capacity problems are even more acute at drilling sites, which are often far away from rail heads. It takes about five trucks to empty and haul a railcar full of sand and transport it to the rig site.
And active drilling sites are constantly hungry for sand. It’s estimated that about 3 to 5 million pounds, or more than 100 truckloads, of sand will be used for fracturing a single well.
Halliburton has worked with both the railroads and trucking companies to more efficiently manage the handling and delivery of sand to drilling sites. This has meant the company ensuring to the railroads that the sand is unloaded expeditiously, Wesbey said.
The company has also attempted to bring only the most efficient truckers on its system for managing load pickups and safely delivering to the well sites. However, many small truckers aren’t able to make that transition, and this has caused Halliburton to experience some rationalization in truck capacity.

“It will be those companies that want to work with us and be managed,” who will become part of Halliburton’s automated transportation management system (TMS), Wesbey said. Those that do participate receive the benefits of “getting paid quicker and appreciate the ability to schedule trucks to get more turns,” he said.
Halliburton is also erecting facilities around the country to unload railcars quickly and store sand to enable it to be trucked within a couple of hours to sites. Wesbey said this has required Halliburton to prove this new delivery methodology to the well owners. “The customers have traditionally wanted trucks lined up on site before the work even starts,” he said.
“What we’ve learned is that we all need to play in the sandbox as business partners to deliver for our customers,” Wesbey said.
“Our aim is to design a more efficient process and work with the railroads and the trucking companies to achieve improved service and efficiency for us all as we look to long-term relationships,” said John Vogt, Halliburton’s vice president of global logistics.